Gandhian Economics

Gandhiji first promulgated his radical economic theory in the book “Hind Swaraj” written on his journey from England to South Africa. The book was a powerful disparagement of the Industrial Revolution and its ill effects - written after a first hand experience in the home of the Industrial Revolution. His views on economics and how they have fared over the years is what I have sought to understand here.

Gandhiji held that machinery displaced labour and hence concentrated wealth in the hands of the few. A view which met with dissent from even his most ardent admirers. His ideas though met with constant change over the years from the time when he first published “Hind Swaraj” in 1912.

Gandhiji advocated the Theory of Trusteeship which held the capitalists as trustees of wealth for the service of the society. Reliance in the mid-eighties and Infosys in contemporary times have amply demonstrated the true import of Gandhiji’s teachings.

Gandhiji also advocated the precept of limitation of wants and material comforts as a stint in Industrial Revolution ravaged London convinced Gandhiji of the futility of machine induced economic prosperity. He believed that creating money minting machines out of human beings doesn’t lead to prosperity and hence stressed on village economies which purportedly lead to a life of contentment. To put it succinctly, he considered prosperity to be as much spiritual as material and hence visualized the development of an economy that would lead to prosperity of the self as well as the soul.

Gandhiji believed that the key to the country’s progress lay in the strengthening of the decentralized, self sufficient village economies. Lending power at the micro level ensures decrease in large scale corruption, clipping the wings of politicians and bureaucrats. Also the formation of decentralized, self sufficient economies could ideally lead to a best of both worlds – by lending power to the people it creates a democracy and by preventing the “rich get richer, poor get poorer” cycle it ensures socialism.

Some of Gandhiji’s concepts have lost their relevance over time with globalization and the subsequent opening up of the Indian economy. Yet his clear foresight and idealist thinking have painted a utopian dream that refuses to sink into oblivion.